Tesco continued to put its rivals in the shade following an 18.7 per cent rise in half- year profits to £908 million.

The group, which has more than 250,000 staff and around 1,780 stores in the UK, also reported a 14.1 per cent jump in sales to £18.8 billion for the six months to August 13 as it bucked the downward trend elsewhere in the retail sector.

The figure for the UK was ahead 8.2 per cent on a like- for-like basis.

The profits figure is given under new accounting rules, with the retailer achieving growth of 14.4 per cent to £940 million through the previous format - under which it posted a surplus of more than £2 billion last year.

Tesco continued to benefit from international business and its drive into non-food areas, where sales were up 13 per cent to £2.8 billion in a weak market.

Total revenues from the UK rose 11.1 per cent in the six- month period to £14.6 billion, with operating profits ahead 19.2 per cent to £801 million.

Tesco forecast further growth in its second half but warned that higher oil-related charges meant costs may be as much as £60 million higher than budget for the full year. It has also faced above-inflation increases in business rates.

Chief executive Sir Terry Leahy said: "We have been able to deliver another good performance in a more challenging year.

" Looking forward, the accumulating effects of rising oil-related costs, both on consumer confidence and on our business, are a cause for concern but we remain confident that we will make further progress in the second half."

The figures were ahead of market expectations and came as Tesco boosted its share of the grocery market to 30.5 per cent, although this strips out the impact of retailers such as Marks & Spencer. Across the wider retail sector, Tesco has an estimated 13 per cent share of the market.

Such dominance has fuelled concerns about the impact of the chain's rapid growth on independent retailers, as well as its suppliers.

Friends of the Earth is amongst those campaigning for an investigation into Tesco's power.

Vicki Hird, supermarket campaigner for the environmental group, said: "The competition authorities should be embarrassed that they have let things get this far and must now act to curb the local and national monopoly of Tesco."

Tesco said a total of 630,000 square feet of new sales area was opened in the UK during the first half in all of its formats, of which almost 130,000 square feet was in extensions to existing stores.

A further 1.3 million square feet is planned to open during the second half, including just over 530,000 square feet from extensions. That is likely to result in the creation of another 7,500 jobs in the UK.

Tesco said customers benefited from lower prices during the period as it reported deflation of two per cent. It also said product availability had been improved, while self-service check-outs were introduced to 130 stores.

Toughening trading conditions meant like-for-like sales dipped to 7.6 per cent in the second quarter - 6.6 per cent when excluding petrol - although Sir Terry said this was still ahead of prudent planning for growth of around 3-4 per cent.

Seymour Pierce analyst Rhys Williams said: "Overall a solid performance, as expected, and the business looks well placed to continue to expand."

Richard Hunter, head of UK equities at stockbrokers Hargreaves Lansdown, added: "The fact remains that Tesco is the darling of the sector and is best equipped to cope with any slowdown in consumer confidence or the side-effects of a higher oil price.

"With its international expansion continuing at a measured pace and with its domination of the UK market unrivalled, it continues to be the pick within a demanding marketplace."